THE LEGO GROUP : BUILDING STRATEGY

GROUP 5 ANKITA SINHA KARUNESH PANDEY S.R. ARCHANA

CASE SUMMARY
COMPANY WAS STARTED IN 1934

FAMILY RUN BUSINESS UNTIL 1979

STARTED ITS OPERATIONS PRODUCING WOODEN TOYS 1947 -BOUGHT PLASTIC INJECTION MOLDING MACHINE AND STARTED PRODUCING PLASTIC TOYS 1958 PATENTED THE LEGO BRICK DESIGNS IDEA TO CREATE A TOY THAT PREPARES CHILD FOR LIFE LEGO ESTABLISHED AS BUILDING A TOY OF CHOICE

1960

Expanded sales Europe,US, Canada, Japan& Australia Expanded to 200 different shapes of brick design Introduced new brick DUPLO eight times the original lego brick

1970

2500 employees new innovative series for girls doll houses,furniture, ships LEGO TECH Series mechanical moving parts, town featuring city characters, astronauts & Spacecrafts

1980

50th year 1982- expanded to educational line for Schools and DUPLO Baby Series Introduced light and sound series , addition to their tech series ( motors controlled by computer)

1990

Top 10 largest toy manufactures 7000 Employees -Exclusive lego stores Lego manic slogans through TV ads launched their own website in 1996 Lego computer games Acquired license to movies and children themes

2000

Licensed rights to Harry potter , Spiderman batman etc Special sets to adults expand traditional video games

LEGO OPERATIONS
Non Licensed Building Sets Online Website Licensed Building Sets

Stores & Merchandise

The LEGO Group

Video Games

Theme Parks

Board Games

Q 1.)ANALYSE LEGOS VARIOUS BUSINESS LINES WITH RESPECT TO COMPETITIVE ADVANTAGE THESE ENJOY
Wodden Toys Business Initial operations 1960 stopped selling wooden toys LEGO THEME PARK LEGOLAND Opened in home country - Denmark

Plastic Toys Lego System to plays DUPLO Doll Houses, Furniture Ships LEGO City Lego Castel Lego Space Lego TECH Series Lego Pirates LEGO WESTERN LEGO Adventures

Video games & Computer Games

LEGO MIND STORMS License to movies and children themes LEGO STAR WARS Harry potter Spiderman LEGO Universe online video games

COMPETITIVE ADVANTAGES
PATENTED LEGO BRICK DESIGN LEGOS LARGE PRODUCT LINE TECHNOLOGICAL INNOVATION RIGHT UNDERSTANDING OF THE TARGET AUDIENCE LEGO PROVIDED NON VIOLENT VIDEO GAMES LICENSE TO CHILDREN THEMES & MOVIES STRONG BRAND IMAGE

Q2.)IMPACT OF CHANGES IN THE MARKET PLACE ON FUTURE BUSINESS OPPORTUNITIES WITHIN THE TOY INDUSTRY
acquisition of marvel entertainment by walt disney --created major license agreements implications --marvel had a wide catalogue of overe 5000 comic book characters that were hugely successful in films --placed large amount of entertainment licensing under the control of one organization eu decision to remove lego brick trademark

new competition from hasbro launching a similar rival product line kre-o
--featuring popular transformers --huge size and brand power of hasbro big box toy discounters trampled mom-and-pops and lowered prices dramatically

birth rates declined, children had less time to play and not much interest in toys that didn't offer instant gratification
rise of online games

3.EVALUATION OF VARIOUS EXPANSION OPPORTUNITIES

INCREASE THE MARKET SHARE IN THE UNITED STATES --MANY AMERICANS MAY THINK THEY BUY A LOT OF LEGO PRODUCTS,BUT THEY BUY ONLY ABOUT A THIRD OF WHAT GERMANS BUY, FOR EXAMPLE INCREASE MARKET SHARE IN EASTERN EUROPE, WHERE THE TOY MARKET IS GROWING VERY RAPIDLY INVEST IN EMERGING MARKETS EXPAND DIRECT-TO-CONSUMER ACTIVITIES (SALES THROUGH LEGOOWNED RETAIL STORES),ONLINE SALES, AND ONLINE ACTIVITIES (SUCH AS ONLINE GAMES FOR CHILDREN) CREATING INNOVATIVE NEW PRODUCTS FROM CONCEPTS DEVELOPED UNDER THE TITLE OBVIOUSLY LEGO, NEVER SEEN BEFORE.

 E.G. LEGO GAMES SYSTEM, WHICH IS FAMILY BOARD GAMES (A NEW WAY OF PLAYING WITH LEGO BRICKS) EXPAND LEGO EDUCATION, ITS DIVISION THAT WORKS WITH SCHOOLS AND KINDERGARTENS DEVELOP ITS DIGITAL BUSINESS

4. WHAT SHOULD LEGO DO EXPAND ITS PRODUCT LINES AND BUSINESS OPPORTUNITIES?
GETTING LICENSES OF THE POPULAR COMIC CHARACTERS IN THE EMERGING MARKETS SUCH AS INDIA, CHINA ETC. PARTNERING WITH UPCOMING SCIENCE FICTION MOVIES AND LAUNCHING THE TOYS WITH THE RELEASE OF THE MOVIE TO TAKE ADVANTAGE OF THE BUZZ

5. STRATEGY FOR MAINTAINING LEGO'S MARKET DOMINANCE.

USING IT FOR IMPROVING THE OPERATIONS CUSTOMIZATION OF THE TOYS ACCORDING TO LOCAL TASTE PARTNERING WITH DISNEY(MARVEL) MORE FOCUS ON THE COMPUTER GAMES

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